BRE-Carester Deal Highlights Risks in Rare Earth Supply Amid Global Shortages
Brazilian Rare Earths has secured a decade-long heavy rare earth offtake deal with Carester, aligning Brazil’s high-grade resources with a leading European separation facility. This partnership also includes engineering support to accelerate BRE’s refinery development.
- 10-year binding offtake agreement for up to 150 tonnes per annum of dysprosium and terbium oxides
- Carester to provide engineering and technical services for BRE’s rare earth separation plant in Brazil
- Caremag facility in France backed by French government and Japanese partners targets late-2026 start
- BRE’s Monte Alto project offers one of the world’s highest-grade heavy rare earth deposits
- Strategic move to establish Brazil as a global rare earth production hub
Strategic Partnership to Address Critical Supply Gaps
Brazilian Rare Earths Limited (ASX, BRE) has taken a significant step toward cementing Brazil’s role in the global rare earths market by signing a binding 10-year heavy rare earth offtake agreement with Carester SAS. This deal secures the supply of up to 150 tonnes per annum of dysprosium and terbium oxides, two critical heavy rare earth elements essential for high-performance permanent magnets used in electric vehicles, renewable energy, and advanced technologies.
Carester, a specialist in rare earth processing with a track record of designing and optimising separation plants worldwide, will also provide engineering and technical services to support the construction and commissioning of BRE’s planned integrated rare earth separation plant at the Camaçari Petrochemical Complex in Bahia, Brazil. This dual role as both customer and technical partner underscores the depth of collaboration between the two companies.
Leveraging High-Grade Brazilian Resources
At the heart of this partnership is BRE’s Monte Alto Rare Earths Project, located within the Rocha da Rocha Rare Earth Province, renowned for its exceptionally high-grade heavy rare earth mineralisation. The project boasts world-leading concentrations of dysprosium, terbium, neodymium, praseodymium, and other critical minerals such as niobium and scandium. This positions BRE to supply premium feedstock to Carester’s Caremag facility in Lacq, France.
Caremag is poised to become one of the largest heavy rare earth separation and recycling plants globally, with a nameplate capacity of approximately 600 tonnes per annum of DyTb oxides. Supported by substantial funding from the French government and Japanese partners including JOGMEC and Iwatani Corporation, Caremag aims to commence operations in late 2026, significantly bolstering Western supply chains for these strategic materials.
Engineering Collaboration Accelerates Refinery Development
Beyond the offtake agreement, Carester’s commitment extends to providing specialised engineering, process design, commissioning support, and optimisation services for BRE’s refinery project. This long-term technical services agreement, running through to the end of 2031 with options for extension, is designed to ensure seamless integration from construction through to steady-state operations and potential future expansions.
Such collaboration not only mitigates execution risks but also aligns the technical development of BRE’s refinery with downstream processing capabilities at Caremag, creating a tightly linked supply chain from Brazilian feedstock to finished heavy rare earth oxides.
Strategic Implications for the Rare Earths Market
This partnership reflects a broader strategic imperative to diversify and secure supply chains for critical minerals outside of traditional dominant producers. By combining BRE’s resource strength with Carester’s processing expertise and established European infrastructure, the alliance aims to address the global shortage of heavy rare earths, particularly dysprosium and terbium, which are in high demand for emerging technologies.
BRE’s Managing Director Bernardo da Veiga emphasised the validation this partnership brings to their strategy of accelerating development of high-grade Brazilian assets and establishing Brazil as a global rare earth hub. Meanwhile, Carester’s President Frédéric Carencotte highlighted the complementary nature of the Brazilian resource and the French processing facility in creating a secure, Western-aligned supply chain.
Bottom Line?
This alliance sets the stage for Brazil’s emergence as a critical player in the global rare earths supply chain, with market watchers keenly awaiting construction milestones and operational progress.
Questions in the middle?
- What are the detailed financial terms and pricing mechanisms underpinning the offtake agreement?
- How will potential delays in the construction of BRE’s refinery or Caremag facility impact supply commitments?
- What strategies are in place to mitigate market price volatility for heavy rare earth elements over the 10-year term?
